The heel method, as mention, is a fine starting point. However in my case, I can barely touch the pedal with my heel when the saddle is as my prefered height. Perhaps in part because I have size US14 feet, and the cleat is probably 8" from my heel.
There is no "correct saddle height." You ride what's comfortable. My saddle is ~1.5" higher than would be recommended by a test (the straddle a level and mark the wall, specifically) but so long as the knees don't hurt and the hips ain't rockin', it's the right height.
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